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HCI Group Reports Second Quarter And Six-Month 2013 Results

A replay of the call will be available after 8:00 p.m. Eastern time on the same day through August 9, 2013.

Toll-Free Replay Number: 877-660-6853

International Replay Number: 201-612-7415

Conference ID#: 418494

About HCI Group, Inc.

HCI Group, Inc. owns subsidiaries engaged in diverse, yet complementary business activities, including homeowners' insurance, reinsurance, real estate and information technology services. The company's largest subsidiary, Homeowners Choice Property & Casualty Insurance Company, Inc., is a leading provider of property and casualty insurance in the state of Florida.

The company's common shares trade on the New York Stock Exchange under the ticker symbol "HCI" and are included in the Russell 2000 Index. Its 8% Senior Notes trade on the New York Stock Exchange under the ticker symbol "HCJ." Its 7% Series A, cumulative redeemable preferred shares trade on the NASDAQ Capital Market under the ticker symbol "HCIIP." For more information about HCI Group, visit www.hcigroup.com .

Forward-Looking Statements

This news release may contain forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Words such as "anticipate," "estimate," "expect," "intend," "plan," "confident," "prospects" and "project" and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various risks and uncertainties. Some of these risks and uncertainties are identified in the company's filings with the Securities and Exchange Commission. Should any risks or uncertainties develop into actual events, these developments could have material adverse effects on the company's business, financial condition and results of operations. HCI Group, Inc. disclaims all obligations to update any forward-looking statements.

 
 
HCI GROUP, INC. AND SUBSIDIARIES 
Consolidated Balance Sheets 
(Amounts in thousands, except share amounts) 
     
     
  At June 30, 2013 At December 31, 2012
  (Unaudited)  
Assets    
     
Fixed-maturity securities, available-for-sale, at fair value $ 40,119 35,953
Equity securities, available-for-sale, at fair value  10,335  8,876
Other investments  16,014  16,087
Total investments 66,468 60,916
Cash and cash equivalents  296,812  230,214
Accrued interest and dividends receivable  410  375
Premiums and reinsurance receivable  28,305  10,642
Prepaid reinsurance premiums  31,236  9,112
Deferred policy acquisition costs  18,608  10,032
Property and equipment, net  13,008  10,853
Deferred income taxes —   3,848
Other assets  6,934  2,296
     
Total assets $ 461,781 338,288
     
Liabilities and Stockholders' Equity    
     
Losses and loss adjustment expenses $ 44,749 41,168
Unearned premiums 191,446 154,249
Advance premiums 11,273 4,029
Assumed reinsurance balances payable 1,466 1,377
Accrued expenses 7,725 3,041
Dividends payable  34  42
Income taxes payable 124  8,813
Deferred income taxes 1,529 — 
Long-term debt  40,250 — 
Other liabilities  9,600  4,316
     
Total liabilities 308,196 217,035
     
Stockholders' equity:    
7% Series A cumulative convertible preferred stock (liquidation preference $10.00 per share), no par value, 1,500,000 shares authorized,191,750 and 241,182 shares issued and outstanding in 2013 and 2012 —  — 
Preferred stock (no par value 18,500,000 shares authorized, no shares issued or outstanding) —  — 
Common stock, (no par value, 40,000,000 shares authorized, 11,434,216 and 10,877,537 shares issued and outstanding in 2013 and 2012) —  — 
Additional paid-in capital 65,394 63,875
Retained income 87,294 55,758
Accumulated other comprehensive income  897  1,620
     
Total stockholders' equity 153,585 121,253
     
Total liabilities and stockholders' equity $ 461,781 338,288
 
 
HCI GROUP, INC. AND SUBSIDIARIES 
Consolidated Statements of Income
(Unaudited)
(Amounts in thousands, except per share amounts) 
         
  Three Months Ended Six Months Ended
  June 30, June 30,
  2013 2012 2013 2012
         
Revenue        
         
Gross premiums earned  $ 81,952 53,772  $ 164,499  108,470
Premiums ceded  (24,617)  (16,702)  (46,613)  (30,969)
         
Net premiums earned  57,335  37,070  117,886  77,501
         
Net investment income  295  302  434  824
Policy fee income  1,426  1,028  2,198  1,543
Net realized investment (losses) gains  (8) 9  12 30
Gain on bargain purchase —  179 —  179
Other  285  267  614  430
         
Total revenue  59,333  38,855  121,144  80,507
         
Expenses        
         
Losses and loss adjustment expenses  17,414  16,197  33,286  35,365
Policy acquisition and other underwriting expenses  7,308  6,243  13,276  13,079
Interest expense  846 —   1,532 — 
Other operating expenses  7,358  4,406  13,473  8,673
         
Total expenses  32,926  26,846  61,567  57,117
         
Income before income taxes  26,407  12,009  59,577  23,390
         
Income taxes  10,172  4,747  22,955  9,160
         
Net income $ 16,235 7,262  $ 36,622  14,230
         
Preferred stock dividends  (32)  (63)  (66)  (244)
         
Income available to common stockholders $ 16,203 7,199 $ 36,556  13,986
         
Basic earnings per common share $ 1.44  0.85 $ 3.31  1.89
         
Diluted earnings per common share $ 1.40  0.74 $ 3.20  1.60
         
Dividends per common share $ 0.23  0.20 $ 0.45  0.35
CONTACT: Company Contact:
         Les Holland, Investor Relations
         HCI Group, Inc.
         Tel (813) 405-3281
         lholland@hcigroup.com
         
         Investor Relations Contact:
         Matt Glover or Michael Koehler
         Liolios Group, Inc.
         Tel (949) 574-3860
         hci@liolios.com

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